The Contentious South Stream Pipeline

In recent months, the South Stream pipeline — which could bypass Ukraine to bring Russian natural gas to countries in the Balkans and Central Europe — has become a source of friction between Brussels and Moscow as well as between the European Union and the member states involved in the project. Between 2008 and 2010, Gazprom signed memorandums of understanding with Bulgaria, Serbia, Hungary, Greece, Slovenia, Croatia and Austria for the construction of South Stream. The European Union has always resisted the pipeline, which it says violates European legislation that splits energy production and transmission. In late 2013, the European Commission said member states should renegotiate their agreements with Russia to ensure that they comply with EU norms. The crisis in Ukraine severely deteriorated the European Union's relationship with Russia, however, and suddenly South Stream became an even more contentious issue. As a direct threat to Russia, the European Commission said it would delay negotiations with Moscow over the future of the pipeline. While most countries remained cautious, Bulgaria came out in defense of South Stream. According to the company South Stream Bulgaria, the construction of the Bulgarian part of the South Stream pipeline will start in May or June. Austria recently also regained interest in the project.

As the poorest member of the European Union, Bulgaria has to deal with conflicting interests. Like most EU members, Sofia is interested in reducing its dependence on Russian natural gas. It also, however, sees South Stream as a source of investment and job creation. In addition, South Stream could help Bulgaria reduce the risk of being cut off from natural gas supplies coming through Ukraine at a time when Bulgaria is going through prolonged political instability. More important, Sofia sees support for South Stream as a way to get lower natural gas prices from Gazprom. High energy prices were one of the biggest complaints in the protests that brought down the government of Boyko Borisov in early 2013. The Ukraine crisis is deepening existing divisions within the European Union, and the debate over South Stream — where some member states are putting their national interests ahead of Brussels' policies — is a perfect illustration. From a broader perspective, the South Stream issue also shows the extent to which members are willing to challenge the authority of EU institutions. These episodes will become more frequent as Europe's political fragmentation deepens.